Denial of responsibility: The findings of the following analysis are the sole views of the author and should not be considered investment advice
In recent weeks, Ethereum Classic [ETC] incremental growth reached the $38-$39 range. This range has been reversed to show trends of a supply zone, especially after the most recent rejection higher.
A significant uptick in buying volumes may help turn the trend in favor of the bulls. A close above this supply zone can further confirm the bullish bias.
Additionally, the support of the three-week trend line (white, dashed) could take a vital place in influencing the future movements of the altcoin. At press time, the alt was trading at $38.16, up 5.64% in the last 24 hours.
ETC 4 Hour Chart
ETC saw an atypical ROI of over 240% as bulls embraced a sensational rally from July 13 to the alt’s four-month high on July 29. This buyback helped the bulls find a much-needed close above the EMA bands.
In recent days, ETC entered a compression phase near the Point of Control (POC, red) in the $36 zone. Meanwhile, the support of the three-week trend line, POC, and the 20 EMA have coincided, offering rally grounds for ETC.
However, with the immediate supply zone [$38-$39] following the recent rally, bulls still need to increase buying volumes.
Bounce from the 20 EMA may help buyers retest immediate resistance before a potential upside volatile break. In this case, the likely target would be in the $40-$41 range.
If the broader sentiment dampens bullish vigor, a close below trendline support could delay near-term recovery prospects. Buyers will aim to continue their spree from the $33 baseline.
The Relative Strength Index (RSI) maintained its position above the midline and projected a slight bullish edge. However, it had yet to jump above the 61 mark to project a strong bull dominance.
On the other hand, the Accumulation/Distribution metric and the CMF could not confirm the higher peaks of the price action. Thus, forming a bearish divergence in this time frame.
Also, the directional trend of the altcoin has been negatively affected and reflects a rather fragile strength.
Looking at the contribution of the trendline support along with the EMA bands and the POC, ETC bulls will look to break on high volatility in the coming sessions. However, bearish divergences in the indices could cause sluggishness before a potential revival. In both cases,the objectives will remain the same as discussed.
Last but not least, broader market sentiment and chain developments will play a vital role in influencing future moves.